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01 June 2015 - The Basilan provincial government has urged closer economic ties between Mindanao and Sabah, noting that economic engagements will benefit both areas.

In a courtesy call at the Philippine Embassy in Kuala Lumpur on May 28, Basilan Vice Governor Keemhar Jay Sakkalahul and members of the Sangguniang Panlalawigan (Provincial Board) said that there is much to be gained in economic cooperation.

“Economic development and growth in these areas will ensure long-term stability and order, as the people will feel the benefits in terms of jobs, income and a better life for themselves and their families.  It is also what will consolidate the peace process in Mindanao,” she said.

For his part, Deputy Chief of Mission and Philippine Consul General Medardo Macaraig said that there should be separate but parallel initiatives in securing peace and stability in these areas.

“Initiative to enhance ties should continue between Mindanao and Sabah, along with closer security cooperation to address challenges arising from security concerns,” he said.

During the call, Vice Governor Sakkalahul was accompanied by members of the Basilan provincial government, who are in Malaysia to explore economic opportunities and closer business ties, particularly in the halal sector.

They expressed concerns on the economic impact of a proposed ban on barter trade between Mindanao and Sabah, particularly on the prices of basic goods and economic development in these areas.

“Additional costs are being borne by the consumers in a number of island provinces near Sabah.  Businesses in Sabah will also be affected, as their sales and income will definitely go down if there will be a barter trade ban. It would be counterproductive for both sides if a ban is implemented,” Vice Governor Sakkalahul said.

“This will also be contrary to the vision of the Brunei-Indonesia-Malaysia-Philippines-East ASEAN Growth Area (BIMP-EAGA) in developing Mindanao and Sabah as engines for growth in the region,” he added.

Based on a study by International Alert in 2014, the barter trade is a PhP2 billion (around RM167 million) economy, where each player is earning some PhP1.4 to 2.5 million (some RM112,000 to RM208,000) a year.  In Malaysia, barter trade earnings account for a total of RM150 to RM300 million (roughly PhP1.8 billion to 3.6 billion) annually.

In a press conference last week, Sabah Inspector General of Police Tan Sri Khalid Abdul Bakar floated the idea of recommending a ban on the barter trade between Sabah and Mindanao as a security measure, after two Malaysians were kidnapped in a seafood restaurant along Sandakan’s shorelines on May 14.

There are many efforts to further economic ties between the two areas, most recently Felda Global Ventures Holdings Bhd (FGV) subsidiary’s Felda Agriculture Services Sdn Bhd (FASSB), which will supply its premier oil palm seeds to planters in Mindanao. FASSB signed a Memorandum of Collaboration with the Philippines’ Bali Oil Palm Produce Corporation (BOPPC) recently to explore the possibility of collaborating in agriculture-related products and services.

Malaysian Minister of International Trade and Industry Datuk Seri Mustapa Mohamed, who was in the Philippines for the Asia-Pacific Economic Cooperation (APEC) Ministers Responsible for Trade in Boracay from May 23 to 24, also led a delegation of Malaysian companies which would like to do business in the Philippines. He said that Malaysian companies should be “more aggressive” in tapping the potential of the Philippines as a trade and investment destination.  END